Strategic Report for Romania 2021 EEA and Norwegian Financial Mechanisms 2014-2021
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Strategic Report for Romania 2021 EEA and Norwegian Financial Mechanisms 2014-2021 1. Executive summary The social and economic situation of Romania was severely affected by the COVID-19 pandemic. A range of measures to limit the spread of the coronavirus were imposed, such as the closure of schools/online teaching, suspension of cultural, entertainment and sports activities, restriction of travel and movement, restrictions on social gatherings, etc. The already challenged public health, education and social assistance sectors were severely disrupted, affecting in particular Romanian society's most vulnerable groups. In this difficult context, by March 2021, all EEA and Norway Grants Programmes achieved a significant level of progress, finalizing the preparatory activities, carrying out selection procedures and project contracting. An amount of €307,754,152 has been made available in 66 open calls launched, representing 91% of the budget. Overall, 410 projects are currently in implementation with a total value of €271,792,169, representing 57% of the total budget. On the Programmes managed by Romania, 247 projects have been contracted, with a total value of €225,766,553 (70% of the total available budget). Financial implementation is also progressing, 27.55% of the available budget being disbursed to Programmes and €82,694,217 (16%) of the budget has been paid to projects. More efforts are needed when it comes to the preparation of a few remaining predefined projects and related donor partnership agreements in the Justice, Culture and Local Development Programmes. So far, 93% of the budget allocated to predefined projects has been contracted. An important milestone achieved was the finalisation of the process for the allocation of the reserve, an additional €20 million (and related national co-financing) being distributed to research, children and youth at risk, public health, justice and culture. The distribution was based on the analysis of progress achieved, financing needs in the Programmes/programme areas, level of interest registered in the open calls already carried out, implementation and absorption capacity, as well as consultation with the relevant Programme Operators. All the modifications were agreed at the end of June 2020 and the amended MoUs were finalized on 8 September 2020. Most importantly, the Grants are starting to deliver tangible results. Through the projects supported by the Local Development Programme, 1,397 children and young people at risk of early-school leaving and 86 children and young people with special education needs started to receive social services. Out of the 15,000 persons belonging to vulnerable groups targeted by the Programme, 1,254 started to receive personalised services (information, counselling, social, education and medical services, support for employment etc.). 800 people living in the streets and other vulnerable categories received information services, counselling, occasional street help, medical evaluations and medical treatments. The Education Programme supported 86 students and 125 educational staff mobilities. The programme is also increasing the institutional capacity of schools to ensure an effective inclusion of Roma children. 99.75% of all teachers involved in the training sessions declared an improvement of their competencies regarding Roma inclusion. 399 teachers were trained on inclusiveness and multicultural environment, 806 Roma and Romanian parents participated in joint projects activities along with 1382 of pupils (Roma and Romanian pupils); discrimination perceived by pupils in schools decreased by more than 26%. Most projects under the Health Programme have faced delays and suspensions due to COVID-19 restrictions. However, progress in terms of results can be seen. The project dedicated to improving cancer screening for people in isolated or vulnerable situations, carried out a door to door information campaign which reached 26,400 women and performed 6,796 cervical cancer tests, while respective all COVID-19 safety rules. Guidelines for diagnostic and treatment of children with cancer, based on bilateral cooperation with the Norwegian partner, were developed and procurement of medical equipment is advanced. Overall, 559 children were reached by the project. The pandemic-related restrictions had a significant impact on the cultural sector in Romania and the areas of intervention of the Culture Programme represented a substantial support, though the projects in implementation and the new open calls launched. Despite the travel restrictions, the cooperation with the Donor Programme Partners and International Partners Organisations was good in all Programmes, as they participated in all aspects of Programme implementation and 1 in regular online Cooperation Committees and Selection Committees meetings. Already, 122 projects under the Programmes managed by Romania are implemented in bilateral partnership. The pandemic has clearly put additional risk on the EEA & Norway Grants Programmes, primarily in terms of timely implementation of projects. Additional efforts are required from project promoters and partners to overcome the limitations and restrictions and deliver the results expected on time. The NFP and Programme Operators have taken measures to mitigate these risks, but unpredictable future developments remain a challenge. 2. Political, economic and social context The social and economic situation of Romania was severely affected by the COVID-19 pandemic. A range of measures to limit the spread of coronavirus were taken by the government - a state of national emergency/alert was declared, schools were closed (with teaching moved online), cultural, entertainment and sports activities were restricted, the activity of certain businesses was suspended and travel and movement restrictions were applied. As in the rest of Europe, the measures were temporarily lifted and reimposed based on the number of new cases and hospital admissions. Parliamentary elections were held on 6 December 2020 and a new three-party coalition government was invested on 23 December. Local elections were also held in September 2020. These political changes did not affect the management and control structure or the implementation of the Programmes. According to Eurostat, Romania’s economy shrank in 2020 by an estimated 3.9%, outperforming the rest of the EU which registered an average contraction of 6.2. A severe 12.2% GDP contraction in the second quarter of 2020 was followed by a rebound of 5.8% in the third quarter. The unemployment rate remained around 5%, as government policy measures were applied out to reduce the impact to the labour market. The measures taken to tackle the spread of the virus contributed to an increase in the digitization of activities and procedures, both at national and local level. The use of electronic signatures has been better regulated, obligations were imposed to public institutions to accept documents in electronic form and digitally signed. Support measures for businesses with activity affected by the crisis were taken by the government such as subsidised salary costs for staff being in technical unemployment, deferred payment for utilities, electricity, natural gas, water, telephone and internet services, rent for the building used as office, or bank credit payments. According to current data, Romania’s GDP is forecast to grow by 3.8% in 2021 and by 4% in 2022 (source: EC European Economic Forecast report winter 2021 and Eurostat). The education process was severely disrupted, especially for children in already vulnerable situations, by the closure of schools, with online teaching expertise and technical capabilities lacking. The Save the Children Foundation estimates that school closures in the context of the pandemic has widened already existing inequalities between children and has obstructed or effectively prohibited access to education for over 600,000 children who could not attend online school. In this context, remedial and school-after-school programmes have become even more necessary in the next period. Consistently low educational outcomes and high rates of early school leaving remain. Ensuring equal opportunities for students from poor households, particularly in rural areas, and the Roma community remains a challenge. The labour market relevance of vocational, training and higher education remains limited and damages job perspectives. The acquisition of basic and digital skills showed no progress, and would benefit from methods to forecast and anticipate future skill needs. The already challenged public health system in Romania suffered greatly with hospital overcrowding, shortage of medical staff, overwhelming pressure on medical staff, lack of protective equipment and intensive care capacity. Emergency funding was made available from the European Funds and state budget which helped to remedy some of issues. Romania recorded a peak in the rate of excess mortality (as defined by Eurostat) in December 2020, estimated at 51%. As in the rest of Europe, the pandemic crisis had a significant impact on the cultural sector. The restriction of organizing events that involve a large number of persons, prohibition of leaving the house without a justified reason during the state of emergency (May – April), restrictions imposed during the state of alert have all caused challenges for the cultural players to continue their activity and even to survive. The sector was targeted by the support measures taken by the government, with different schemes